Monday, February 14, 2011
Certainties in Life - Death and Obama's FY2012 Budget: Taxes, Taxes, and More Taxes
There's a certain irony that POTUS released his Fiscal year 2012 Budget today....It was his "love letter" to our money.....as he intends to try & take more of it from us for his spending.
You'll hear a lot of political wrangling about the subject BUT when the deficit runs to an all-time high on his watch, he OWNS this one.
The subject of Death & taxes is nothing new....here is some history on the phraseology:
A rather fatalistic and sardonic proverb. It draws on the actual inevitability of death to highlight the difficulty in avoiding the burden of taxes.
Several famous authors have uttered lines to this effect. The first was Daniel Defoe, in The Political History of the Devil, 1726:
"Things as certain as death and taxes, can be more firmly believed."
Benjamin Franklin (1706-90) used the form we are currently more familiar with, in a letter to Jean-Baptiste Leroy, 1789, which was re-printed in The Works of Benjamin Franklin, 1817:
"'In this world nothing can be said to be certain, except death and taxes."
Another thought on the theme of death and taxes is Margaret Mitchell's line from her book Gone With the Wind, 1936:
"Death, taxes and childbirth! There's never any convenient time for any of them."
SO....let's look at the updated version of this game, courtesy of the "Empty Suit" who presently resides in the Oval Office. Just for reference, here's a shot of the clock that keeps track of it for you from this weekend....the totals are higher (as you read this)
Obama's FY2012 Budget:
Taxes, Taxes, and More Taxes
From Ryan Ellis on Monday, February 14, 2011 12:00 PM
President Obama released his budget this morning. Rather than focusing on Washington’s over-spending problem, the budget calls for higher taxes on families and small businesses to pay for even more government spending. Under the Obama budget, tax revenues will grow from 14.4% of GDP in 2011 to 20% of GDP in 2021. By comparison, the historical average is only 18% of GDP.
Tax hike lowlights include:
•Raising the top marginal income tax rate (at which a majority of small business profits face taxation) from 35% to 39.6%. This is a $709 billion/10 year tax hike
•Raising the capital gains and dividends rate from 15% to 20%
•Raising the death tax rate from 35% to 45% and lowering the death tax exemption amount from $5 million ($10 million for couples) to $3.5 million. This is a $98 billion/ten year tax hike
•Capping the value of itemized deductions at the 28% bracket rate. This will effectively cut tax deductions for mortgage interest, charitable contributions, property taxes, state and local income or sales taxes, out-of-pocket medical expenses, and unreimbursed employee business expenses. A new means-tested phaseout of itemized deductions limits them even more. This is a $321 billion/ten year tax hike
•New bank taxes totaling $33 billion over ten years
•New international corporate tax hikes totaling $129 billion over ten years
•New life insurance company taxes totaling $14 billion over ten years
•Massive new taxes on energy, including LIFO repeal, Superfund, domestic energy manufacturing, and many others totaling $120 billion over ten years
•Increasing unemployment payroll taxes by $15 billion over ten years
•Taxing management capital gains in an investment partnership (“carried interest”) as ordinary income. This is a tax hike of $15 billion over ten years
•A giveaway to the trial lawyers—not letting companies deduct the cost of punitive damages from a lawsuit settlement. This is a tax hike of $300 million over ten years
•Increasing tax penalties, information reporting, and IRS information sharing. This is a ten-year tax hike of $20 billion.
Add it all together, and this budget is a ten-year, $1.5 trillion tax hike over present law. That’s $1.5 trillion taken out of the economy and spent on government instead of being used to create jobs.
The “tax relief” in the budget is mostly just an extension of present law, and also some refundable credit outlay spending in the tax code. There is virtually no new tax relief relative to present law in the President’s budget.
Read more: http://www.atr.org/obamas-fy-budgetbr-taxes-more-a5844##ixzz1DxwOe04i